Aereo Plans to Expand Online Service to 12 New TV Markets

By Andy Fixmer -
Jul 23, 2013

Aereo Inc., the Barry Diller-backed
service that sends broadcast TV signals online to subscribers,
will announce start dates for 12 new markets in the next several
weeks, Chief Executive Officer Chet Kanojia said.

Aereo’s goal is to reach a quarter of the U.S. population
in five to seven years, Kanojia said yesterday at the Fortune
Brainstorm Tech conference in Aspen, Colorado. The New York-based company uses tiny antennas to capture broadcast signals
for its customers.

Owners of broadcast networks and TV stations, including CBS
Corp. (CBS) and Walt Disney Co. (DIS), are battling Aereo in court, saying
the service steals their programming and resells it. Chase Carey, chief operating officer of 21st Century Fox Inc. (FOXA), has
said if the courts don’t stop Aereo, Fox may become a cable
channel to block the service. Kanojia said he expects the
federal government would intervene in such a case.

Aereo is available in New York, Boston and Atlanta,
according to the company’s website, with plans to expand to 18
more cities. Aereo doesn’t operate in California, Arizona,
Nevada, Oregon, Hawaii, Alaska, Washington, Idaho or Montana,
where a U.S. District Court blocked a similar service in
December.

The pace of closely held Aereo’s expansion will fall short
of a company forecast earlier this year that the service would
be available in 22 markets in three months, Kanojia said. Aereo
will be available in about 20 cities, he said.

“We have a very patient investor base,” Kanojia said.

Kanojia said Aereo won’t take sides in a fee dispute that
threatens to cut off CBS and its Showtime network for customers
of Time Warner Cable Inc. (TWC) The companies’ contract expires on
July 24, and a spokeswoman for Time Warner Cable, Maureen Huff,
told the New York Times the company would recommend Aereo to its
New York customers if CBS goes dark.

Disagreements such as the one between CBS and Time Warner
Cable will become more common as broadcast networks seek higher
fees from pay-TV systems for the right to retransmit local TV
signals to subscribers, Kanojia said.